Cabot Prime Pro Week Ending September 25, 2020
Stock Recommendation Tracker
The Stock Recommendation Tracker is a table that features all of the current recommendations in all of our portfolios. It’s a quick way for you to see what stocks are currently in our portfolios and will highlight new additions or any changes to our recommendations over the previous week. We include this table at the bottom of the Weekly Summary, and provide a link here at the top to the Stock Recommendations Tracker.
Cabot Weekly Review (Video)
In this week’s stock market video, Mike Cintolo remains in a cautious stance as few stocks are making a ton of headway and as the market’s intermediate-term trend has turned down. There’s still some good news, including many resilient names, so he’s OK with a little nibbling here, but the main goal remains patience as we wait for the bulls to retake control.
UPCOMING CABOT EVENTS:
Cabot Micro-Cap Insider Member Call – October 2020
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Turnaround Investing with Bruce Kaser
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Cabot Retirement Club Member Call - October 2020
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Advisory Services
Cabot Growth Investor
Bi-weekly Issue September 24: In tonight’s issue, Mike goes over all our positions (including the new buys, which we think are battling for pole position for the market’s next advance) and talks about one simple chart tool that can help you spot other potential leaders going forward, too. Since the last issue, we’ve sold Spotify (SPOT) and taken partial profits in ProShares Ultra S&P Fund (SSO), but we added stakes in Five Below (FIVE), Pinterest (PINS) and Seattle Genetics (SGEN). All in, that leaves us with a cash position of around 44%.
Special Bulletin September 23: The market’s continued weakness has tipped our Cabot Tides to the negative side of the fence for the first time since April. That said, we’re not changing wholesale as we’ve been cautious for a while (40%-plus cash for three weeks), and encouragingly, many of our stocks are holding their own (or even advancing). In the Model Portfolio, Mike has one small change—he’s going to take partial profits on ProShares Ultra S&P 500 Fund (SSO), selling one-third of our position given that the Tides have turned negative. That will leave us with a cash position of around 44%.
Bi-weekly Update September 17: The market and big-winning growth stocks from this year remain iffy—today’s drop put our Cabot Tides on the fence and many growth stocks are still in a rough patch. However, there’s also some fresher leadership that’s acting resiliently, looking to take pole position for the market’s next sustained advance. All told, tonight, we’re going to remain cautious, but we are repositioning the portfolio a bit—we’re selling our half position in Spotify (SPOT) but adding a full position in Five Below (FIVE) and half positions in both Pinterest (PINS) and Seattle Genetics (SGEN). We’ll still have about 40% in cash even after these moves.
Other Stocks of Interest September 10: Follow ups to stocks featured May 7, 2020 (issue 1445) to September 10, 2020 (issue 1454). Since many of the stocks written about in Other Stocks of Interest don’t make their way into the Model Portfolio, you won’t see them followed on a regular basis in the issues. However, we are monitoring these stocks, and this listing gives you a quick view of our latest thoughts.
Cabot Top Ten Trader
Movers & Shakers September 25: Throw in the fact that the longer-term trend is up, and the odds still favor the market hitting higher highs down the road—this looks a lot like a relatively normal correction/consolidation within an overall bull market. But given that we had such a huge five-month rally, it’s also likely that market probably needs more time to wear and scare out the weak hands, and for big investors to reposition their portfolios. You should remain cautious overall (we’re likely to leave our Market Monitor at a level 5 come Monday’s issue), but it’s fine to pick up small positions in some potential new leaders here and there, especially as many are trying to set up ahead of the next market upturn. Mike’s suggested buys today are: Qualcomm (QCOM), Roku (ROKU) and Tupperware (TUP). Today’s suggested sells: Arconic (ARNC), Farfetch (FTCH), Kinross Gold (KGC), Kirkland Lake (KL), Pacira Pharm (PCRX) and Salesforce.com (CRM).
Weekly Issue September 21: Since we pulled in our horns weeks ago, we’re not changing our stance much: We remain cautious, with the indexes having issues and rotation coming fast and furiously among individual stocks. That said, we’re not sticking our head in the sand, either, as we’re seeing a decent number of issues either show signs of bottoming out or holding firm despite the market’s wobbles. We continue to advise taking it slow and holding some cash given the overall environment, but select nibbling is OK, preferably on dips and shakeouts. This week’s list has many names acting well, though their day-to-day action remains volatile. Mike’s Top Pick is Seattle Genetics (SGEN), which looks like it’s starting to emerge from a two-month correction; we think you can start small here or on dips.
Cabot Options Trader and Cabot Options Trader Pro
Note that the current week’s Weekly Update, earnings updates, position updates and stocks on watch are posted on the website in the Market Update section, which is deleted each week.
Cabot Options Trader Market Update September 24: We have pared back our portfolio with sales of the balance of our Disney (DIS) and Visa (V) positions in the last two weeks, and haven’t added any new buys. For now, as the market is skimming the bottom of the recent ranges, those sales, and lack of new buys, has been the right move. Hopefully we won’t have any more sales in the days to come, but if the market continues to fall, we will drop our exposure even more.
Cabot Options Trader Stock on Watch September 23: Farfetch (FTCH) was a red-hot growth stock in mid-2020 rising from a low of 7, to a high above 30 in the middle of August. Since that August top, coinciding with most growth stocks cooling off, FTCH fell to a low of 23 earlier this week. If this odd call buying continues Jacob could see us buying a FTCH covered call, or buying calls targeting the January 25 strike.
Cabot Options Trader Pro Trade Alert September 21: Adjust Existing Position: Buy Back the JD.com (JD) October 90 Call, and Sell the November 85 Call.
Cabot Options Trader Basic and Pro Trade Alert September 21: Sell Existing Position: Sell your Disney (DIS) January 135 Call for $4.50 or more.
Cabot Options Trader Pro Weekly Update September 21: Jacob has 9 long positions: DIS, GM, JD, MSFT, PTON, SNAP, TSM, XLF, ZNGA and one short position: QQQ December Puts.
Cabot Options Trader Weekly Update September 21: This week’s watch list is made up of trades in two stocks that I have been eyeing for the past several weeks, Merck (MRK) and Marvell Technology (MRVL), and a bull call spread in a former leader, Spotify (SPOT), that has fallen with its peers in recent weeks.
Cabot Undervalued Stocks Advisor
Weekly Update September 23: What should investors do in this kind of market? Our approach is to be patient with our stocks. We check the valuations, read any fresh news, understand the macro situation and mostly do very little. We have confidence that our company managements are doing their best to build value for shareholders (otherwise we probably shouldn’t own the stock). Our stocks have low expectations so the downside should be relatively limited. We also make sure we aren’t over-extended in our stock holdings, so we have the ability to endure otherwise painful days like Monday. Bruce has no changes to the portfolio today.
Monthly Issue September 2: With this issue, Bruce is setting price targets for many of our stocks. In subsequent issues, he will provide targets for the remaining stocks as well as for each newly recommended stock. Price targets help us stay the course when our stocks weaken on noise, and help provide a tangible exit point. The assumptions behind the price targets provide a roadmap to gauge the company’s recovery process. Bruce has two portfolio changes today: Molson Coors Beverage Company (TAP) moves from Buy to Strong Buy and Voya (VOYA) moves from Strong Buy to Buy.
Cabot Stock of the Week
Weekly Issue September 21: With this morning’s broad selling, the intermediate-term of the market is now down—but the long-term trend is still up! How you handle this depends partly on your own risk tolerance and partly on how your stocks are acting. If your stocks look good, Tim favors holding, but if they’re falling, he recommends selling. Today’s recommendation comes from a sector that is definitely outside our usual hunting ground. But fundamental trends look good, so in choosing today’s stock, Tim’s goal was to find something that could rise if the market kept falling and he found it in this gold stock. Agnico Eagle Mines (AEM), originally recommended by Mike Cintolo in Cabot Growth Investor might turn into a great investment! There are two portfolio changes today: Azek (AZEK) moves to Hold and LGI Homes (LGI) moves to Sell.
Cabot Global Stocks Explorer
Bi-weekly Update September 24: After taking some profits from your winners and weeding out a few poor performers, you likely have some cash available to put to work. If you have a little bit of patience, you could do worse than exploring emerging markets. These countries contain about 80% of the world’s population and almost 60% of GDP, more than double their share from two decades ago. Take, for example, the WisdomTree Emerging Markets High Dividend Fund (DEM). This is the sort of ETF that you could tuck into your portfolio and forget about. Meanwhile, Carl will be putting forth some specific emerging market stocks in the coming weeks for our Explorer portfolio. Carl has one portfolio change today: Global X Cybersecurity ETF (BUG) moves from hold to sell.
Bi-weekly Issue September 17: The trend favoring highly scalable, high growth U.S. technology stocks is unlikely to change in the near future but diversifying into different countries and sectors is a good idea as we move into the fourth quarter. So today, Carl heads to Australia for a high-flying fintech stock. Many consumers, particularly millennials and Asian consumers, don’t like credit cards. Because of the fees and chargeback, retailers don’t like them either. Enter Afterpay AFTPF, which is revolutionizing the retail payment industry by effectively enabling interest-free loans at a growing number of retailers. Carl has it rated Buy a Half. There is one portfolio change today: Swire Pacific (SWRAY) moves from Hold to Sell.
Cabot Small-Cap Confidential
Weekly Update September 24: In terms of our portfolio, the average change in our positions over the last five sessions is just +1%. And just to put things in perspective, the average change since August 20, which is right before the S&P 500 broke out to new highs on the insane run in tech stocks, is just -5%. In short, the grind continues. Stay patient. Tyler has no portfolio changes today.
Monthly Issue September 3: This month we’re jumping back into the pure-play software space with an up and coming SaaS company that has remained under the radar since going public in December, just a few months before the market tanked. Sprout Social (SPT) specializes in social media management solutions, which are increasingly important as the trend toward digital transformation strategies gets stronger. Organizations increasingly recognize they must market to consumers through social networks. Tyler has it rated Buy.
Cabot Dividend Investor
Weekly Update September 23: After pulling back over 8% from the high, the market is having trouble finding any traction. And the selling may not be over. While the economy is likely to rebound strongly in the quarters ahead, investors see risks in the near term. One issue is the upcoming election, which is increasingly in everyone’s face as we move closer to November 3rd. Plus, the Supreme Court situation made the political rancor between the two parties even uglier, which makes a stimulus agreement less likely. Tom has no rating changes today.
Monthly Issue September 9: In this uncertain environment, Tom found a rare stock. It is a company that benefits from the undeniable trend toward technological proliferation. It has solid earnings growth and stock performance. But it provides these benefits with remarkably low volatility. Digital Realty Trust (DLR) is off the high after a rare pullback and selling at a cheap price. Historically, it has less than a quarter of the volatility of the overall market. It’s a great forward-looking investment for this uncertain environment. He has no other portfolio changes.
Cabot Marijuana Investor
Update September 23: Tim will sell half of both Aphria (APHA) and Canopy (CGC), because money is clearly still coming out of Canadian marijuana stocks; peer Aurora (ACB) released a terrible report yesterday and is down big today. He will also sell one-third of the positions in Curaleaf (CURLF), Green Thumb (GTBIF) and Trulieve (TCNNF). The first two stocks are holding at support, but we are overweighted, and Trulieve has seen some heavy selling in the past week and has no support level in sight.After these sales, the portfolio will be roughly 49% in cash.
Monthly Issue August 26: Our long-term strategy remains unchanged. Own the leaders. Sell the losers. And remember that someday, when marijuana is declared legal across the U.S., the institutions will come running. Technically, Cabot’s major market-timing indicators remain bullish, so overall, Tim is bullish. But two weeks ago, he sold 25% of each of our U.S. operators because the stocks had grown so overbought over the past few months—and all four of those stocks are lower today. In short, buying power in the sector has dried up in recent weeks, even as investor sentiment has heated up, and that’s a dangerous combination. So short-term, he is turning a little more cautious today, not by selling anything but simply by downgrading more stocks to hold. Ideally, this soft patch will pass and buyers will return, but for now, the tide is going out slowly so be careful where you dive.
Special Report: April 29, 2020
U.S. Vertically Integrated Multistate Operators (MSOs)Cabot Early Opportunities
Special Bulletin September 24: With 32 stocks in our portfolio and a market that’s going through all manner of gyrations right now, it’s time to part ways with a few of our underperforming positions. Sell OneWater Marine (ONEW), Liberty Media Formula One (FWONK) and SelectQuote (SLQT), Sell Half Schrodinger (SDGR) and Keep Holding Nikola (NKLA).
Special Bulletin September 22: When we got into Nikola (NKLA) we fully expected a lot of twists and turns. We didn’t expect the current drama. That said, it’s not all that surprising given the high-profile nature of the company and the founder, and his tendency to shoot from the hip. More conservative investors may wish to just sit pat and see what comes next. That’s the strategy Tyler is advising. We have a half-sized position, which to me feels like plenty right now. Even if the stock surges 50% or so from here, the long-term potential is still significant enough that we can buy our second half when the climate is more positive. If you don’t have a position yet, and you can stomach the drama, this is a compelling time to start a position, buying up to a half-sized position. Tyler is sure there will be more to come before long! Nikola (NKLA) moves to HOLD.
Monthly Issue September 16: Tyler’s advice today is to continue to average into the stocks that are most attractive to you and which you think you’ll have the best chance of holding onto through the inevitable corrections. The September selloff may or may not be over. The market is trying to look forward into the first half of 2021 at a time when vaccines could hit the market. There is lot of uncertainty surrounding what could happen, and how evolving business and consumer trends will shift. And that’s going to continue to work through the market in hard-to-predict ways. Our game plan will continue to be to find companies that can excel now, in 2021, and beyond. Since we often don’t know exactly how things will play out it’s important to always average in. Today’s Top Pick is Kinsale Capital (KNSL), the only publicly traded property and casualty (P&C) insurer focused exclusively on the excess and surplus (E&S) lines market in the U.S.
Cabot Profit Booster
Weekly Issue September 22: The Stock – Pinterest (PINS) PINS quacks like a new leader. After crashing as low as 10 earlier this year, the stock jaggedly advanced into July before exploding higher after Q2 results. While the action has been choppy since then, we think the fact that the stock hasn’t given up any of those gains (even as many growth stocks have been hit) is a plus. Bottom line, it looks like PINS wants to head higher if the market can stabilize.Stop — 31. The Covered Call Trade: Buy Pinterest (PINS) Stock at 38.75, Sell to Open October 39 Strike Calls (exp. 10/16/2020) for $2, or a Net Price of 36.75 or less.
Position Update September 21: On Friday, the JD.com (JD) September 78 call that we sold expired worthless. Today, because of the recent market weakness Jacob is going to exit our stock position and take a small loss on our covered call.
September Expiration September 17: Tomorrow is the expiration of five of our September covered call trades. It was another great month for the Cabot Profit Booster portfolio! The good news is three will almost certainly be closed for full profits (PINS, APPS, BLDR), one is trading just above our strike price (MTH) and will be a nice winner, and only one is at a super tiny loss (JD).
Cabot Micro-Cap Insider
Weekly Update September 23: Rich writes that we don’t know if the bull market will continue, but we will continue to focus on identifying promising micro-caps with the following characteristics: 1) Strong revenue growth 2) Solid balance sheet 3) High insider ownership 4) Cheap valuation. This week, he has two changes that he wants to highlight. He is increasing the buy limit for Greystone Logistics (GLGI) to 1.10 given strong performance and insider buying and is increasing the buy limit for hopTo Inc (HPTO) to 0.55 given revenue growth, insider buying, and a cheap valuation.
Monthly Issue September 9: Today, Rich is profiling a Canadian SaaS company that is trading for a “value” multiple. NamSys Inc (NMYSF) has sticky, recurring revenue. Other characteristics include: Strong historic revenue growth (25% CAGR), over 40% insider ownership, a strong balance sheet (a significant net cash position) and a cheap valuation. Here are today’s portfolio changes: Increase Buy limit for HopTo (HPTO) To 0.50 from 0.45, move Greystone Logistics (GLGI) from Hold to Buy under 1.00 and move P10 Holdings (PIOE) to Hold.
Special Report
A Defensive Healthcare Stock with 100% UpsideSpecial Report
The Best Way to Play the Oil Market DislocationCabot Income Advisor
Monthly Issue September 23: There has been a lot of activity in the portfolio this past week. Four positions, including AABV, IIPR, QCOM and USB, had covered calls written on them with an options expiration date of last Friday, September 18. Three of those positions exceeded the strike price and were called away (IIPR, QCOM, and USB). There are currently only two positions with outstanding calls. The recent downward-trending market has reduced the level of call premiums and it isn’t an ideal point in time to write more. But things can change quickly. Tom’s featured stock is: Visa (V).
Weekly Update September 16: Several of the positions on which we wrote covered calls are trading above the strike price and are likely to be called away. IIPR, QCOM and USB have run well beyond the strike price on options expiration on Friday. They are certain to be called away. Other positions with calls that don’t expire for another month also have prices that have moved well beyond the strike price, including BIP and SBUX. It may seem unnecessary to write covered calls in a raging bull market. but that’s seldom the case. Over time you are likely to get a better return with this income strategy than just holding a market index.
Special Report:
Off the Radar Cash GeneratorsSpecial Report:
The Covered Call Income MachineWall Street’s Best Investments
Daily Alert September 25: Blackrock Health Sciences Trust (BME) The Personal Capitalist
Daily Alert September 24: Hologic, Inc. (HOLX) Dow Theory Forecasts
Daily Alert September 23: Universal Electronics Inc. (UEIC) Cabot Undervalued Stocks Advisor
Daily Alert September 22: Principal Financial Group, Inc. (PFG) Sure Dividend
Daily Alert September 21: Costco Wholesale Corporation (COST) Internet Wealth Builder
Monthly Issue September 17: The markets have been a bit choppy of late, with the Dow Jones Industrial Average rising to 29,000 at the beginning of the month, then retreating and rising again. It looks like Fall may be a little volatile. As you’ll see in our Advisor Sentiment Barometer and Market Views, sentiment remains bullish, with a hint of caution. Nancy begins our issue this month with her Spotlight Stock, Realty Income Corporation (O), a REIT with above average yield, and a Dividend Aristocrat. In her Feature article, she further explores the REIT industry and explains why it’s almost always a good time to hold a REIT or two in your portfolio.
Ask the Experts
Cabot Growth Investor
Question: THE CORRECTION HAS SPED UP TODAY WITH A BIG SELL-OFF. BOTH SPX AND DOW ARE DOWN THROUGH THE 50 MVA AND HEADING FOR 200 DAY MVA AND BELOW. ANY THOUGHTS/PENDING SALES ETC. THANK YOU.
Mike: Well we’re 40% in cash -- I might trim yes but actually our stocks are generally holding up today (overall). I wouldn’t assume they’re headed to the 200-day or below -- possible, but the odds still favor this being a correction in a bull market. We’re cautious but not selling wholesale.
Question: First of all, I appreciate your recommendation on ROKU. The news today is certainly big for them. Do you see the stock going on a run in this environment? Thank you in advance for your thoughts.
Mike: Thanks for writing, and the kind words. Well, I think it wants to run, the question is if the market lets it. I probably won’t average up as the Tides are now negative, but I certainly would be willing to if that changes. Either way, I’m fine owning/buying a smaller position here or (preferably) on dips.
Quarterly Cabot Analyst Meeting
The recording of the Cabot Prime Members Meeting with the Analysts from July 15, 2020 is now available for you to listen to at your convenience—click here for access. This private call with our analysts is one of your exclusive Cabot Prime Pro member benefits.
Guide to Cabot Prime Pro
This Guide to Cabot Prime Pro will help you make the best use of your Prime membership to create a strong personal portfolio.
Stock Recommendations Tracker
The table below lists all of the stocks held in any Cabot portfolio.
Updated or revised recommendations from the past week are in purple text.
Stocks added to a portfolio are highlighted in green text.
Closed stock positions in the past week are highlighted in red text.
| Stock | Cabot Small-Cap Confidential | Cabot Global Stocks Explorer | Cabot Growth Investor | Cabot Marijuana Investor | Cabot Stock of the Week | Cabot Undervalued Stocks Advisor | Cabot Dividend Investor |
|---|---|---|---|---|---|---|---|
| ABBV | Buy | ||||||
| ACCD | Buy 1/2 | ||||||
| AEM | Buy | ||||||
| AFTPF | Buy 1/2 | ||||||
| APHA | See Advisory | ||||||
| APPF | Hold | ||||||
| ARE | Hold | ||||||
| ARNA | Buy | ||||||
| AVGO | Hold | ||||||
| AVLR | Hold | ||||||
| AZEK | Hold | ||||||
| BABA | Hold | ||||||
| BE | Buy | ||||||
| BGS | Buy | Buy | |||||
| BIG | Hold | ||||||
| BIP | Buy 2/3 | ||||||
| BMY | Strong Buy | ||||||
| BSCL | Buy 1/2 | ||||||
| BUG | Sell | Hold | |||||
| CCI | Hold 1/2 | ||||||
| CDLX | Buy | ||||||
| CGC | See Advisory | ||||||
| COLM | Hold | Buy | |||||
| CRLBF | See Advisory | ||||||
| CURLF | See Advisory | ||||||
| DLR | Buy | ||||||
| DOW | Hold | ||||||
| DXCM | Hold | ||||||
| EPD | Hold | ||||||
| EQH | Strong Buy | ||||||
| EVBG | Hold | ||||||
| EVER | Buy | ||||||
| FIVE | Buy | ||||||
| FVRR | Hold 3/4 | ||||||
| GM | Strong Buy | ||||||
| GRWG | See Advisory | ||||||
| GSHD | Hold 3/4 | ||||||
| GTBIF | See Advisory | ||||||
| GTLS | Buy | ||||||
| HTHT | Hold | ||||||
| IIPR | See Advisory | Hold 2/3 | |||||
| INSP | Buy | ||||||
| KL | Buy 1/2 | ||||||
| KPTI | Hold | ||||||
| LGIH | Sell | ||||||
| LLY | Buy | Buy | |||||
| MKSI | Hold | ||||||
| MO | Buy | ||||||
| MPC | Hold | ||||||
| NEE | Hold | Hold 1/2 | |||||
| NET | Hold 1/2 | ||||||
| NKLA | Buy | ||||||
| NVCR | Buy | ||||||
| PGX | Hold 1/2 | ||||||
| PINS | Buy 1/2 | ||||||
| PLMR | Buy | ||||||
| PWR | Buy | ||||||
| QCOM | Hold | Hold 2/3 | |||||
| QTWO | Buy | ||||||
| REMX | Buy 1/2 | ||||||
| RGEN | Buy | ||||||
| RNG | Hold | ||||||
| ROKU | Buy 1/2 | ||||||
| RPAY | Buy | ||||||
| SE | Hold 1/2 | Hold | |||||
| SGEN | Buy 1/2 | ||||||
| SPCE | Buy | Buy | |||||
| SPOT | Sold | ||||||
| SPT | Buy | ||||||
| SSO | Sell 1/3 | ||||||
| STAG | Hold 1/2 | ||||||
| SWRAY | Sold | ||||||
| TAP | Buy | Strong Buy | |||||
| TCNNF | See Advisory | Hold | |||||
| TOT | Hold | ||||||
| TPB | See Advisory | ||||||
| TSLA | Hold | ||||||
| TSM | Buy 1/2 | Buy | |||||
| TSN | Buy | ||||||
| TWLO | Hold | ||||||
| UEIC | Buy | ||||||
| V | Buy | ||||||
| VIAC | Buy | ||||||
| VLO | Hold 1/2 | ||||||
| VOYA | Buy | ||||||
| VZ | Buy | ||||||
| WING | Hold | ||||||
| XEL | Hold 2/3 | ||||||
| ZM | Hold | ||||||
| ZS | Sold |